Sources: Telltale Games Closes Majority of Studio, The Wolf Among Us 2 and Stranger Things Canceled [Update, Correction]

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Update 4 [4:12pm]: As information continues to come out of today's announcement that Telltale Games is closing, and particularly in light of Telltale's statement, there are new revelations to the situation at Telltale.

We previously reported that a skeleton crew will remain behind to complete work on The Walking Dead Final Season. That information was inaccurate. Sources who wish to remain anonymous explained that there is a skeleton crew at Telltale, but they will be working on the Minecraft Story Mode project for Netflix. In fact, The Walking Dead team was also laid off today and The Walking Dead Final Season will not be completed.

This matches with the statement issued by Telltale games where the company promised to "fulfill the company's obligations to its board and partners." Our sources say The Walking Dead Final Season is set to end after the second episode launches next week.

Update 3 [2:35pm PT]: Telltale has issued a statement announcing that a small team of 25 will stay to "fulfill the company's obligations to its board and partners." No word yet on Telltale's other games, but the company says it will explain in the coming weeks. Here's the full statement below:

Today Telltale Games made the difficult decision to begin a majority studio closure following a year marked by insurmountable challenges. A majority of the company’s employees were dismissed earlier this morning, with a small group of 25 employees staying on to fulfill the company’s obligations to its board and partners. CEO Pete Hawley issued the following statement:

“It's been an incredibly difficult year for Telltale as we worked to set the company on a new course. Unfortunately, we ran out of time trying to get there. We released some of our best content this year and received a tremendous amount of positive feedback, but ultimately, that did not translate to sales. With a heavy heart, we watch our friends leave today to spread our brand of storytelling across the games industry.”

Telltale will issue further comments regarding its product portfolio in the coming weeks.

Update 2 [2:10pm PT]: Telltale co-founder and former Telltale CEO Kevin Bruner has posted a blog calling the layoffs at Telltale a "closure." Seemingly confirming the fate of the studio he co-founded.

Update 1 [1:50pm PT]: USgamer learned from multiple anonymous sources familiar with the layoffs at Telltale that employees laid off today will not receive severance pay.

Original Story

Telltale Games is closing down most of its game development today according to multiple reports online. Telltale employees are also posting on social media that they are no longer employed with the company. An anonymous source familiar with the situation has told USgamer that Telltale's closure was going to be complete.

Telltale Games is a Bay Area-based video game company specializing in narrative adventures. The studio hit prominence with The Walking Dead Season 1 in 2012. The studio has since worked on video games based on Batman, Guardians of the Galaxy, and Minecraft.

In 2017, Telltale Games laid off 90 employees in a restructuring of the company following years of mismanagement. In our report following the layoffs, sources told us that following The Walking Dead Telltale suffered from a constant culture of crunch that pushed employees to release games as quickly as possible. In addition to overbearing management teams that oftentimes meddled in projects, the Telltale Tool proprietary engine was prone to bugs, making development even more difficult.

Telltale is currently in the middle of The Walking Dead Final Season and have previously announced a second season of The Wolf Among Us and a game based on the Netflix hit series Stranger Things. An anonymous source familiar with the company told USgamer that a skeleton crew will remain at Telltale to work on Minecraft Story Mode for Netflix while The Wolf Among Us Season 2 and Stranger Things are effectively cancelled. [Updated above]

Update: The Verge is reporting that 25 employees will stay on board, presumably as part of the skeleton crew.

We have reached out to Telltale Games for more information and we will update you as more information becomes available to us.

To employees affected by the Telltale layoffs there is currently the hashtag #TelltaleJobs trending on Twitter with video game companies offering assistance to affected employees.

Developing.

Correction [1:28pm PT]: An earlier report said that Telltale filed for bankruptcy. Sources say that 'bankrupcty' was mentioned. We regret the error.